Market Volatility Increases Sharply After Fitch Downgrades US Credit Rating

The S&P 500 closed lower for the second straight session on Wednesday after Fitch cut the U.S. government's credit rating to AA+ from AAA.

The ADP said private businesses in the U.S. added 324 thousand workers in July versus a revised 455 thousand rise and surpassing market estimates of a 189 thousand increase.

Advanced Micro Devices, Inc. (NASDAQ: AMD) shares fell 7% on Wednesday after the company issued third-quarter guidance with a midpoint below estimates. Emerson Electric Co. (NYSE: EMR) shares gained 3.8% after the company reported better-than-expected third-quarter financial results and raised FY23 earnings guidance.

Majority of sectors on the S&P 500 closed on a negative note, with information technology and communication services stocks recording the biggest losses on Wednesday. However, consumer staples and health care stocks closed slightly higher during the Wednesday’s session.

The Nasdaq 100 fell 2.21% to close at 15,370.74 on Wednesday, amid losses in shares of Amazon.com, Inc. (NASDAQ: AMZN), Microsoft Corp (NASDAQ: MSFT) and Tesla Inc (NASDAQ: TSLA).

The S&P 500 declined 1.38%, while the Dow Jones fell 0.98% to 35,282.52 in the previous session.

The Chicago Board Options Exchange's CBOE Volatility Index (VIX) rose 15.5% to close at 16.09 on Wednesday.
What is CBOE Volatility Index?

The CBOE Volatility Index, popularly known as VIX, is a measure of the equity market's expectation of volatility based on S&P 500 index call and put options.

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